Unemployment Seen at 10 Percent despite End of Recession
Unemployment in the United States is seen rising to around 10 percent in the second half of 2009 despite reports that the recession is finally over.
According to top forecasters in the US, the economy has already recovered from the slump but weak consumer spending and high unemployment will drag it to a sluggish recovery process.
The latest survey conducted by the National Association for Business Economic (NABE) showed that US unemployment rate may increase to more than 10 percent as the labor market continue to struggle in the wake of the recession.
According to the research firm, weak consumer spending continues to hound the US economy making it harder for companies to create new jobs.
The survey, with 44 professional forecasters as respondents, also showed that the economy is gaining momentum after more than four quarters of decline. Some 80 percent of the experts said that the recession is likely over.
In an interview, NABE President-Elect Lynn Reaser said that despite the growth predictions of the economist, economic recovery will remain at a sluggish pace as US companies are freeze hiring.
He added that while the economy has rebounded from the recession during the third quarter, American consumers are more likely to save up and spend less as the number of jobless will continue to rise until next year.
He stressed that this will restrain consumption that can lead to a double-dip recession.
“We need more consumer-spending to avoid that scenario. But I don’t think that we’re going to fall to the probability of another recession,” he added.
Based on the gross domestic product rating, economic indicators are showing some 2.5 percent growth in the second half of the year and another 2.5 percent increase by the first half of 2010.
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